Remuneration governance
Nomination & Remuneration Committee role
The primary role of the Nomination & Remuneration Committee (Committee) is to assist the Board in discharging its governance responsibilities in relation to the appointment, induction and ongoing assessment of the skills and experience of directors; Board composition; GCEO&MD recruitment; GCEO&MD and EGM remuneration; succession planning for directors, the GCEO&MD and EGMs; evaluating the performance of the Board, its Committees and the directors; and within the scope of its responsibility endorse certain matters for Board approval.
The Committee’s Charter is reviewed on an annual basis.
The current Committee Charter is available on the Australia Post website (auspost.com.au).
Engagement of external advice
To inform its decision making during FY19, the Committee sought independent advice on performance and remuneration related matters from the GCEO&MD, senior executives and management.
External independent remuneration advice was received by Australia Post from
PricewaterhouseCoopers (PwC). The advice included executive remuneration market practice information that was used to benchmark the GCEO&MD and EGMs and the 2019 review of executive remuneration frameworks. None of the advice received included a remuneration recommendation as defined by the Corporations Act 2001.
GCEO&MD and senior executive contract terms
The terms of employment for the GCEO&MD and senior executives are formalised in employment contracts with no fixed term, with the exception of the EGM Product & Innovation who is on a three year fixed-term contract.
The GCEO&MD and senior executive employment contracts typically outline the components of remuneration paid to the individual but do not prescribe how much the total remuneration quantum will be adjusted year to year, with the exception of the GCEO&MD whose remuneration is determined by the Remuneration Tribunal. The contracts provide for participation in an STI in accordance with the 68 relevant STI scheme rules.
Continuation of employment is subject to ongoing performance reviews by the Board and additionally in the case of senior executives the GCEO&MD.
A description of each employment contract termination scenario for the GCEO&MD and senior executives is detailed in the table below.
|
Scenario |
Definition |
|
Termination on notice by the senior executive |
The GCEO&MD and EGM Product & Innovation may terminate their employment contract by providing six months’ notice in writing. All other senior executives may terminate their employment contract by providing twelve weeks’ notice in writing |
|
Termination on notice of a senior executive by Australia Post |
Australia Post may terminate the GCEO&MD and EGM, Product & Innovation employment contract by providing six months’ notice or provide payment in lieu of the full or part of the notice period. Australia Post may terminate all other senior executives’ employment contracts by providing twelve weeks’ notice or provide payment in lieu of the full or part of the notice period. |
|
Termination on notice payments |
Termination on notice payments by Australia Post are compliant with minimum legislation and designed to ensure consistent and equitable practices are applied. For the GCEO&MD and senior executives, termination on notice payments are calculated based on length of service and shall be no less than an amount equal to the notice period and no more than twelve months of fixed annual remuneration. |
|
Termination without notice |
In certain scenarios as set out in the employment contracts of the GCEO&MD and senior executives (e.g. breach of contract, improper conduct or conviction for a criminal offence), Australia Post may terminate the employment contract at any time without notice, and the executive will be entitled to payment of fixed annual remuneration only up to the date of termination. |
|
Death or total and permanent disablement |
In the event of death or total and permanent disablement, there are no financial entitlements due from Australia Post other than the payment of statutory or contractual entitlements of accrued leave and annual leave. The Board retains the discretion to make an ex-gratia payment |
|
Retirement |
There are no financial entitlements due from Australia Post on the retirement of the GCEO&MD or a senior executive other than the payment of statutory or contractual entitlements of accrued leave and annual leave. The Board retains the discretion to make an ex-gratia payment.
|
Visit
https://www.transparency.gov.au/annual-reports/australian-postal-corporation/reporting-year/2018-2019-88